Property investors were holding their breath to find out how the 2017 Federal Budget would affect the real estate market. Many commentators were calling for hefty reforms to afford first time buyers better opportunities to get onto the property ladder.
While the recently released budget isn't necessarily what these commentators were hoping for, there are numerous positive changes. The Budget introduces the First Home Super Savers Scheme, which had early support from affordability lobby group, the First Home Buyers Association.
The new programme will help prospective homeowners budget for their piece of Brunswick real estate.
The Super Savers Scheme is a savings incentive for those looking to purchase their first property. From July 1, future homeowners will be able to salary sacrifice a portion of their income. This "sacrifice" comes out of your pre-taxed salary along with your Superannuation contributions and is subject to the same tax benefits as Super.
These benefits mean that earnings on your additional payments can also be withdrawn with your total savings. Entry-level property buyers will be able to withdraw super saver funds from July 2018.
Like your Super account, contributions and earnings under the Super Saver Scheme will be taxed at 15 per cent and withdrawals will be taxed at 30 per cent less than the marginal rate for their income threshold. These tax benefits adds up to a great saving option for those entry-level buyers looking at a Brunswick property.
Treasurer Scott Morrison stated in his budget speech that compared to common deposit savings accounts, this scheme will allow savers to "accelerate their savings by at least 30 per cent." Furthermore, the benefits of superannuation provide an estimated tax break of $6 -12,000 per person.
Experts agree that the most difficult obstacle for first time home buyers is saving the initial deposit. The Super Saver Scheme will be an excellent plan for dual income couples and families looking at real estate in Brunswick, with each party being able to put away up to $15,000 a year, or $30,000 in total.
This scheme is doubtlessly sounding more attractive than your current savings plan. Who wouldn't want to land their first real estate purchase sooner rather than later? Contact our team today to find out more about property in Brunswick and our surrounding suburbs.